return
ri-TERN
/rɪˈtɜːrn/
A profit from an investment; the money gained or lost on an investment over a period of time, expressed as a percentage or absolute value.
Return can be positive (profit) or negative (loss). It's a key metric for evaluating investment performance, often considered in relation to risk.
The story behind the word. The word 'return' comes from the Old French 'retorner,' meaning 'to turn back.' Its general sense of coming back to a place or state has been in English since the 13th century. The financial meaning, referring to a profit or income that 'comes back' from an investment, developed much later, reflecting the idea of money being put out and then coming back, hopefully with more.
Word relationships
- profit: Specifically refers to a positive return; 'return' can be positive or negative.
- gain: Similar to profit, often implying an increase in value.
- yield: Often refers to the income generated by an investment, typically expressed as a percentage (e.g., dividend yield, bond yield).
- loss: The opposite of a positive return; a decrease in value.
Commonly confused with
- yield: 'Return' is the total gain or loss (including capital appreciation and income); 'yield' typically refers only to the income component (e.g., dividends, interest) as a percentage of the investment.
Word family
- returning (adjective): Coming back.
- returnable (adjective): Able to be returned.
Collocations
- high return
- low return
- annual return
- expected return
- rate of return
- return on investment (ROI)
Idioms & expressions
- diminishing returns
- return on investment (ROI)
Example sentences
- "The stock market generated an impressive return of 15% last year, delighting many shareholders." Investors are always seeking the highest possible return for a given level of risk.
- "Despite the initial decline, the long-term return on her real estate investment proved to be substantial." Calculating the annual return on investment is essential for financial planning.
Memory hook
You 'RETURN' to your investment to see what profit has 'returned' to you. RETURN: money comes back.
When not to use
Avoid using 'return' when referring to a simple refund or the act of giving something back without the implication of profit or loss on an investment.
Fun facts
- The 'risk-free rate of return' is a theoretical rate of return of an investment with zero risk, often approximated by the yield on short-term government bonds.
- Compound returns, where returns themselves earn returns, are a powerful force in long-term investing, famously called the 'eighth wonder of the world' by Albert Einstein.
Related words
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